Some lawmakers say they’ll have Plan B for budget

LITTLE ROCK — Arkansas’ executive branch doesn’t have a contingency budget plan in case the private option is not reauthorized, but some state legislators who favor defunding the program say they are working on their own Plan B.

“At this point, based on the public statements of two senators, the votes aren’t there to pass it, and if that’s the case we all need to be working on, ‘What’s Plan B?’” said state Rep. Nate Bell, R-Mena. “That’s what I’ve spent the last four months working on because I’ve anticipated that we’d probably be in this set of circumstances. We’ve got some policy that we’re discussing.”

The so-called private option, the program enacted by the Legislature last year to use federal Medicaid money to provide private insurance to low-income Arkansans, requires a three-fourths vote of both chambers to receive the appropriation of federal funding for the coming fiscal year. The vote to appropriate initial federal funding for it passed with 28 votes in the 35-member Senate, just one more vote than was needed.

Sen. Missy Irvin, R-Mountain View, who voted for the program last year, said last week she planned to vote against renewing funding for it. Another person who voted for the private option, Democrat Paul Bookout of Jonesboro, resigned from the Senate last year and will be replaced by Jonesboro Republican John Cooper, a private option opponent who won a Jan. 14 special election.

If the private option is not renewed, about $89 million in savings anticipated from the private option would have to be cut out of Gov. Mike Beebe’s proposed balanced budget, administration officials say.

Much of the savings is expected to come from moving some Arkansans out of traditional Medicaid, where the state pays 30 percent of costs, into coverage that is fully funded by the federal government for the first three years and eventually will require the state to contribute 10 percent. Some savings also are expected to result from reducing uncompensated care costs at hospitals across the state, allowing for a reduction in the payments the state makes to hospitals to help with those costs.

About 85,000 Arkansans have enrolled in the private option so far. Some previously were on Medicaid and could be moved back into that program, but state officials say a large number of the state’s working poor would be left without any health coverage if the private option is not renewed.

Bell and other legislators interviewed for this report declined to name any of the specific budget ideas they have been discussing.

“I have been involved in some of the talks about that, but I don’t have anything to say at this point about that,” said Sen. Cecile Bledsoe, chairman of the Senate Public Health, Welfare and Labor Committee.

Rep. Charlotte Douglas, R-Alma, said legislators who favor defunding the private option do not want to do it in a way that hurts people.

“We just want to do it in the most efficient and the most frugal way we can to protect our state budget and to be responsible fiscally,” she said.

“I don’t think I could support a budget that’s based on an $89 million benefit for the private option without much better explanation of where that $89 million came from,” he said.

Several legislators said they believed the executive branch should be working on an alternative budget proposal, given the uncertainty surrounding the private option. Beebe spokesman Matt DeCample said there is no contingency plan because “it’s not how the process works.”

“We submit the governor’s proposed budget, and the legislators decide what they feel should and shouldn’t be funded. Then everyone gets together through revenue stabilization (the process in which funding priorities are established), and you come up with the final general revenue budget for the state.”

DeCample said that if legislators were to propose budget alternatives, “we’d look at them.”

“But we’re still focused on our proposed budget and focused on keeping the private option where it is and keeping that savings in the budget and keeping those insurance policies with the people who now have health care coverage,” he said.